Further information about the end of Employment Tribunal fees

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The challenge to the lawfulness of Employment Tribunal fees brought by the UNISON union was ultimately successful when it reached the Supreme Court and judgment was given on 26th July 2017.

The claim was that the Employment Tribunal fees restricted access to justice because many dismissed former employees could not afford the fees required to pursue a claim. There was also a challenge that the fees impacted more heavily on minority groups who faced fees of £1,200 to pursue discrimination claims all the way to a hearing.

There had been a 73% reduction in the number of Employment Tribunal claims since fees were introduced in July 2013.

The Supreme Court stated that in order for the fees to be lawful they have to be set at a level that everyone can afford and that the evidence before the Court was that the fees imposed by the Fees Order were in practice unaffordable by some people and so high in practice as to prevent people from pursing claims for small amounts. The consequence is that the whole of the fees order which came into force in 2013 was declared unlawful.

The court also found that a higher proportion of women than men brought the type of claims which attract the higher fees and the disparate impact of the fees order could not be justified, therefore the fees order was indirectly discriminatory against women and other protected groups.

Implications

It will be easier for employees to bring claims to the Employment Tribunal and so it is likely that there will be a rise in the number of claims brought to Employment Tribunal. Similarly, employees no longer face hearing fees of up to £950 before a hearing, so fewer cases are likely to be withdrawn or struck out because the employee cannot afford to pay the fee due. This emphasises the importance of getting the procedures right and increases the risks to employers of having to face claims if things are not done correctly.

Benefits to Employers

Although the fees primarily affected employees and were challenged on behalf of employees, employers also faced fees in the following circumstances:-

1. If an employee won their case the Employment Tribunal could order the employer to pay the employee the amount the employee had paid as fees

2. If an employer sought a review of a Tribunal judgment there was a fee payable

3. If both parties consented to judicial mediation there was a fee payable by the employer

4. If the Employer wished to appeal against an Employment Tribunal judgment they had to pay fees to the Employment Appeal Tribunal

Now that the fees order has been declared unlawful, employment Tribunals cannot order an employer to pay fees previously paid by an employee, even where the employee has paid the fees and won the case.

Refunds of fees paid

The Ministry of Justice has said that it will be introducing a scheme to refund fees previously paid since the fee order was made in 2013. This is expected to be introduced later this month.

It is likely that this will enable employees and employers who have made payments directly to HM Courts and Tribunal Service to claim back fees previously paid.

In cases where a Tribunal has ordered an employer to refund an employee who has already paid a fee, it is likely that proof both of the Tribunal order and of actual payment to the employee will be required before repayment can be made, although we are still waiting to see what will be required.

Reinstatement of struck out claims

Employees whose case have been struck out for non payment of fees may well claim to have their case reinstated.

Bringing of out of date claims

It remains to be seen whether any employees will be able to bring claims out of time on the basis that they couldn’t afford the fees. There is a high hurdle for employees who seek to start an unfair dismissal claim out of time, as the test is one of “reasonable practicability,” The Tribunal has a wider discretion in relation to claims of unlawful discrimination brought out of time. Employees can be permitted to bring late discrimination claims if in all the circumstances it is “just and equitable” to allow them. Any delay in bringing such claims from 26th July is likely to be a factor weighing against employees who might apply to a Tribunal to allow their claims to be submitted out of time, as it has been possible to bring claims since 26th July without paying a fee.

The Future

The judgment does not make it unlawful to charge fees in the Employment Tribunal, it just means that the scheme introduced in 2013 was unlawful. It is possible that in the future the Government may seek to introduce a new scheme which makes it affordable for employees to bring claims by, for example, reducing the levels of fees, extending the time over which they are paid, or providing for them to be paid by employers.